EUROPEAN COUNCIL/MFF : COHESION POLICY BUDGET SLASHED BY 8.5%.

 
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The most developed, non-cohesion states will bear the brunt of the cut in the budget for the future cohesion policy, decided by the EU heads of state and government, on 8 February. The 27 agreed on a budget of 325.149 billion for the period 2014-2020. This is admittedly 4 billion more than the amount in last November's proposal, but 29 billion less than in the current programming period (354.8 billion in 2011 prices), in other words an 8.5% reduction. The experts nevertheless consider that France will keep its current allocation due to arrangements foreseen for the transition regions.

The budget will break down as follows:

- 164.279 billion for the least developed regions (more than in the Commission's proposal of 162.6 billion)

- 31.677 billion for transition regions (Commission: 39 billion)

- 49.492 billion for the least developed regions (Commission: 53 billion)

- 66.362 billion for Cohesion Fund beneficiary states (of which 10 billion will have to be reserved to finance projects in the Trans-European Transport Network).

A bonus of 1.387 billion is foreseen for the outermost regions (Canary Islands, Azores, Madeira, Martinique, Guadeloupe, French Guiana, Reunion, Saint-Martin and Mayotte) and for the sparsely populated Nordic regions (in Finland and Sweden). The special allocation traditionally granted to these regions under cohesion policy would amount to 30 per inhabitant per year. This is less than today's level of 35.

Territorial cooperation will have a budget of 8.948 billion, practically identical to the amount it received for 2007-2013 (8.7 billion).

A revision clause is included in the agreement, providing for a mid-term adjustment of the national allocations (thus applicable to the period 2017-2020) on the basis of the most recent GDP statistics in 2016. The resulting national adjustments may nevertheless not exceed 4 billion.

Regions no longer qualifying for the "least developed" category in 2014 (those whose GDP exceeds 75% of the EU average) are assured of keeping at least 60% of their present allocation. This is the safety net. Some will be disappointed, as the Commission proposed that they keep at least two thirds. Another safety net will also apply at national level (rather than regional) whereby each state will keep at least 55% of its present allocation.

Conversely, the heads of state capped the aid each state can receive. The cap is set as a percentage of the budget each obtained for 2007-2017: states will not be able...

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